BEIRUT: The retail exodus from Solidere that began late last year has picked up steam in 2013 and shows no sign of abating.
The Daily Star counted at least 50 vacant retail properties and countless more shops stocked with merchandise, but closed for business. Certain blocks, like MGR Toubia Aoun Street, are lined almost entirely with empty storefronts. Some of them still bear the names of previous occupants, while others have “for rent” signs. The men’s clothing store, Sinno, is the only one of at least 20 retail spaces on the block that was open for business at 4 p.m. Thursday, though a women’s store nearby, Vivae, is apparently open from 11 a.m. to 3 p.m. daily.
Rental prices are still high by Beirut standards, but Solidere would not comment on the existing average rent. The asking price of the restaurant once occupied by Memoires de Chine is $80,000 per year, according to the broker. Costa Coffee’s old space on the parallel street is listed at $125,000.
Lina Baine, who has worked at one women’ clothing boutique on Solideres’ main street for 12 years, said business has declined since the late former Prime Minister Rafik Hariri was killed in 2005, but for the past two years sales have not even covered the monthly rent of $5,000. The situation is the same at the other clothing shop her boss owns nearby, which is a smaller space but rents for $7,000 per month, she said.
“Since the Syrian war started it is worse than it has ever been,” she told The Daily Star before launching into a familiar lament about the political situation. “We have some customers in the Gulf who used to come and still phone us, and we mail things to them. A few visited Lebanon over the new year to get their eyes or nose or lifting done, but not many.”
Even the few retailers who have preferential rents under the 1952 real estate law are finding it more profitable to hand over their keys than keep businesses operating, despite paying artificially low rents.
The handbag shop C. Matar in Souk el-Bazerkan has occupied the same shop since 1954, and is one of the few retailers with a protected rent that has not accepted compensation for giving up the lease, according to Tony Matar, who manages the shop his father established in 1939.
In 2002, a total of six shops with protected rents remained opened. The tailor next to C. Matar handed his keys over in 2008 and shut the shop he had reopened six years earlier. In 2010, a pair of brothers who had been raised in Sweden closed their men’s clothing shop. A jewelry shop and carpet store that opened after 2002 and paid market rate rent closed in 2006 and 2008, respectively. Matar said he pays a rent that is between $20,000 to $30,000 less than new tenants, but the store has not been profitable for two years.
While he might have been able to receive compensation from his landlord before, now there is not enough demand for the space:
“I stayed open because we had a protected rent and because the store gave my father a lot of wealth before the war, and I couldn’t tell him how bad things had become,” he said. “This is the first time since 1954 that I’ve considered selling, but I realize no one would buy it.”